By Paul Goldman
Editor's note: Paul Goldman is a guest columnist for DecisionVirginia.com. The views expressed below are his own and do not necessarily reflect the opinions of NBC12.
The trial of Bob and Maureen McDonnell now turns to away from public corruption to focus on two allegations of bank fraud.
Count #12 claims the former governor ‘knowingly” failed to list “at least $50,000” owed to Jonnie Williams on the personal financial statement required by federally-insured Townebank in connection with a loan application, thus the federal law violation. According to the indictment, the former governor did list “liabilities total[ing] $2,075,000” but this didn’t include the Williams money.
Count #13 is a similar allegation except it is aimed at both McDonnells for “knowingly” making a “false statement” to PenFed, a federal credit union, on a loan application in hopes of influencing their decision. The first couple listed “liabilities total[ing] $2,837,226”, but this amount did not include “at least $120,000 in loans from Jonnie Williams."
In legal terms, “knowing” means intentional, and thus the indictments say the alleged illegal actions were “purposeful," intended by defendants to influence the bank’s decision. The government therefore must prove this specific intent. In addition, and often more important, the criminal law requires the false statement/omission to be “material." Had the bank known the information, it would have rejected the loan or only made it with significantly different terms.
Thus, an honest mistake or a “no harm, no foul” situation can be a good defense to a bank fraud claim.
Many legal experts believe the bank loan allegations pose the greatest criminal risk to the former first family. The TowneBank loan involved the “paperwork for a loan on one” of the residential properties the former Governor owned with his sister at Virginia Beach. The PenFed loan application was “part of an effort to refinance four loans, including the loans” on the two MoBo Virginia Beach properties” owned by the former Governor and his sister (MoBo is their company).
According to the indictment, former governor McDonnell faxed changes to PenFed 18 days after making the initial loan application to reflect the $120,000 lent by Mr. Williams. The government says he took this action “three days after [his wife] was interviewed by law enforcement.”
It is important to remember that an indictment only has to be supported by probable cause. To win a conviction, the evidence has to prove guilt beyond any reasonable doubt.
Which prompts me to ask: Has the government proven its public corruption case beyond a reasonable doubt?
Most court observers have not been impressed with the defense, only the prosecution. This has caught court observers by surprise. But the lawyers aren’t on trial, lucky for them.
Without a “smoking gun," the corruption part of the trial may boil down to a simple question: Do you believe the government’s star accuser, Jonnie Williams, who claims the two men had an implicit understanding, or do you believe the former governor who says Williams, an alleged con man, is lying?
Williams and Star Scientific, Inc. gave roughly the same amount of money to 2005 GOP candidate for governor Jerry Kilgore without any strings attached, as Williams admitted on the witness stand.
Yes, the money went to Kilgore for Governor, not Jerry or his family personally, but Williams conceded the $165,000 at issue in this case is roughly equal to what he gave Kilgore in hopes of being friendly with a potential governor who could help Star Scientific legally.
This is totally consistent with Williams’ modus operandi, he has never tried to bribe a public official.
Thus the question: Why would Williams have changed his proven MO? Moreover, the government evidence fails to answer this question: Who first broached this illegal conspiracy, Jonnie Williams or Bob McDonnell? Someone had to bring it up first.
What happens if it boils down to whether the jury can believe Mr. Williams beyond a reasonable doubt?
The prosecutors know the risk, since Williams is an alleged con man, on the federal scam radar since the 1980s, and has been shown to be liar about the facts at issue many times in the past. He is only testifying due to getting a “get out of jail free card” of transactional immunity from the government for any related criminal conduct. Several of the prosecution’s own witnesses said Williams couldn’t be believed.
If the former Governor can survive cross-examination – and this is huge risk he has to take – it could come down to Jonnie vs. Bob on the issue of reasonable doubt.